Illinois-based Horace Mann Educators Corp. reported net income of $18.9 million (44 cents per share) and $40.6 million (95 cents per share), respectively, for the three and six months ended June 30, 2004, compared to net income of $2.1 million (5 cents per share) and $10.2 million (24 cents per share) for the same periods in 2003.
Included in net income were net realized losses on securities of
$0.8 million ($0.5 million after tax, or 1 cent per share) for the second
quarter and net realized gains of $4.5 million ($2.9 million after tax, or 7 cents per share) for the first half of 2004, compared to net realized gains of $2.2 million ($1.5 million after tax, or 3 cents per share) for the second quarter of 2003 and net realized losses of $2.5 million ($1.6 million after tax, or 4 cents per share) for the six months ended June 30, 2003. All per- share amounts are stated on a diluted basis.
“Horace Mann followed a strong first quarter of 2004 with another solid
performance in the second quarter,” said Louis Lower II, president and CEO. “Our underlying property and casualty results continued to gain traction, benefiting from additional underwriting and pricing actions taken over the last several quarters, ongoing improvements in
claims processes, and cost containment initiatives. Our property and casualty results this year have also been helped by the absence of adverse prior years’ reserve development and by the relatively low level of catastrophe losses and claim frequencies enjoyed by the industry as a whole.
“Based on results for the first half of the year, we are increasing our
full year 2004 estimate of net income before realized investment gains and losses by 25 cents to between $1.45 and $1.55 per share,” said Lower. “This projection reflects our favorable underwriting trends, yet remains cautious regarding potential catastrophe losses in the second half of the year.”
Net income for the property and casualty segment improved $19.7 million for the quarter and $26.2 million for the six months compared to the year earlier periods due primarily to the factors cited above.
The company’s premiums written and contract deposits increased 9 percent and 10 percent compared to the quarter and six months of the prior year, respectively, reflecting significant growth in new annuity deposits and rate increases in the property and automobile lines.
Horace Mann’s career agency force totaled 805 agents at June 30, 2004. “Though the agency force is smaller than it was a year ago, the number of experienced agents has increased, average agent productivity is up 24 percent compared to the first half of 2003, and career agent annualized new sales increased 17 percent for both the quarter and six months,” added Lower.
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